Preliminary studies from our laboratory have provided electrophysiological evidence that schizophrenics have a deficit in an inhibitory neuronal pathway involved in the gating of auditory sensory information. In normal control subjects, and early wave of the auditory averaged evoked potential (P50) demonstrates marked inhibition of response to a test stimulus presented O.5 second after a conditioning stimulus, with full recovery occurring 5 to 6 seconds later. This inhibition is largely lacking in schizophrenics, both while unmedicated and acutely psychotic, and also when chronically stable on neuroleptic drugs. This deficit in inhibition may be responsible for the hypersensitivity to sensory stimuli which characterizes psychosis. Although neuroleptics do not improve the deficit in inhibition, they do improve other alterations in the evoked potential [consistent with their known effect on catecholamines and also with their partial clinical effectiveness]. A similar deficit in paired-pulse inhibition is observed in manic patients, but it reverts to normal when they become clinically euthymic. This proposal seeks to expand and verify our preliminary studies by adding more subjects with different severities of illness, by increasing the sophistication of the data analysis through digital computer averaging and analysis of waveforms, and by developing an animal model which can be invasively manipulated. A replication of our previous findings is proposed in a larger set of male, drug-free schizophrenics with controlled demographic variables such as age, length of illness, and prior medication experience. Multichannel recording from various sites on the scalp will also extend previous work, which was confined to the vertex. Basic neuronal mechanisms responsible for this inhibition will be tested in parallel experiments on laboratory animals, Both gross macropotentials and single neuron action potentials in anesthetized, as well as unanesthetized, freely-moving animals will be studied.